Crypto License in Singapore

1. Incorporate a Singapore Company

a. Register a Private Limited Company with ACRA

• Choose a Company Name: Select a unique and relevant name. Avoid restricted or sensitive words that might require additional approvals (e.g., “Bank,” “Finance,” etc.).
• Prepare Incorporation Documents: This includes the company constitution (Memorandum and Articles of Association), shareholder agreement, and any other foundational documentation.
• Electronic Filing: File incorporation documents online through ACRA’s BizFile+ portal. Upon successful processing, you will receive an official certificate of incorporation.

b. Directors and Shareholders

• Minimum One Resident Director: Under Singapore law, at least one director must be a Singapore citizen, Permanent Resident, or holder of certain valid work passes.
• Corporate Shareholders: If a parent or holding company is involved, ensure full disclosure of ultimate beneficial owners to maintain transparency.
• Director Responsibilities: Directors are legally responsible for compliance, corporate governance, and ensuring that the company meets its statutory obligations.

c. Company Secretary and Local Registered Office

• Qualified Company Secretary: Appoint a secretary within six months of incorporation. This individual must be a Singapore resident and qualified to handle corporate filings and compliance requirements.
• Registered Office Address: Secure a physical office where official correspondences and notices from authorities can be received. This address must be open and accessible to the public during regular business hours.

d. Corporate Bank Account

• Choosing a Bank or EMI: Many crypto-related companies opt for European Electronic Money Institutions (EMIs) or select local/ international banks that are familiar with digital asset businesses.
• Account Setup: Provide documentation such as business plans, know-your-customer (KYC) policies, and details on expected transaction volumes. Banks often perform enhanced due diligence for crypto enterprises.

2. Draft a Comprehensive Business Plan

a. Define Your Business Model

• Products & Services: Clearly identify the scope of your offerings—whether it’s a crypto exchange, digital payment token services, custodial solutions, or other blockchain-based services.
• Target Market & Strategy: Outline the jurisdictions where you plan to operate, the target customer base, and how you plan to differentiate in a competitive crypto landscape.

b. Risk Management & Internal Controls

• Risk Assessment: Highlight potential operational, financial, and compliance risks specific to crypto activities. Develop mitigation strategies for each identified risk.
• Transaction Monitoring: Specify how you plan to track and monitor transactions in real time, including triggers for enhanced due diligence.

c. KYC/AML/CFT Policies

• Compliance Framework: Detail how you will comply with AML/CFT regulations (e.g., suspicious transaction reporting, KYC checks).
• Customer Onboarding & Verification: Discuss how you will verify identities, manage risk classifications for clients, and handle data security.
• Ongoing Compliance Training: Demonstrate a structured approach to training employees and updating compliance policies in line with MAS guidelines.

d. Financial Projections

• Revenue & Expenses: Provide estimated revenue streams (e.g., trading fees, listing fees, wallet services) and projected operational costs.
• Capital Requirements: Illustrate how you plan to meet minimum paid-up capital (often ~S$100,000) and maintain liquidity for business continuity.

3. Prepare and Submit License Application

a. Collect Necessary Documentation

• Corporate Documents: Include the certificate of incorporation, constitution, and shareholder agreements.
• Financial Statements: Provide audited or unaudited financials (if you have existing business operations). Startups may need to demonstrate proof of funding.
• Compliance Manuals: Prepare documentation for AML/CFT, risk management, data protection, and business continuity plans.
• Board Resolutions: Obtain official board approval to apply for the relevant license (e.g., Standard Payment Institution or Major Payment Institution).

b. Submission to MAS via the Online Portal

• MAS GoBusiness Licensing Portal: Create an account to file the application electronically.
• Application Fees: Pay the required application fee (ranging from S$1,000 to S$1,500, depending on the license type).
• Documentation Accuracy: Ensure that all entries are consistent, accurate, and up-to-date. Inconsistencies can lead to delays or rejections.

c. Preliminary MAS Response

• Acknowledgment of Receipt: MAS typically confirms receipt of your application via email.
• Initial Review: MAS may request additional or clarifying information at this stage. Promptly address all queries to avoid delays.

4. Undergo Application Review & MAS Assessment

a. MAS Due Diligence and Review

• Business Model Evaluation: MAS assesses whether your services fall under digital payment tokens, securities, or other regulated areas.
• Risk Management Framework: The regulator scrutinizes your AML/CFT policies, KYC procedures, and transactional oversight.
• Fit & Proper Test: Key personnel (directors, CEO, compliance officers) must meet MAS’s “fit and proper” criteria, which considers integrity, financial soundness, and experience.

b. Respond to MAS Queries

• Timely Communication: Engage in open dialogue with MAS, provide requested documents, and clarify ambiguities.
• Additional Documentation: Be prepared to supply references, more detailed compliance procedures, or supplementary financial data.
• Site Visits & Interviews: In some cases, MAS representatives may request onsite assessments or interview key management to evaluate their expertise and governance standards.

5. Receive Approval & License Issuance

a. Regulatory Decision

• Approval in Principle (AIP): MAS may issue an AIP outlining certain conditions to be met before the final license is granted (e.g., specific capital requirements, additional staffing).
• Full License Grant: Upon fulfilling all conditions, MAS will issue the relevant license (Standard or Major Payment Institution).

b. Post-Licensing Obligations

• Annual Compliance: You’ll need to maintain updated AML/CFT frameworks, submit regular transaction reports, and pass annual audits.
• Ongoing MAS Supervision: Stay aware of any new or updated regulations, guidelines, or circulars from MAS. Non-compliance can lead to penalties or license revocation.
• Operational Scale-Up: With the license in hand, you can focus on expanding your user base, refining your product offerings, and forming strategic partnerships.

c. Typical Timeline

• 6–8 Months: Most crypto license applications take this long, but it may extend based on the complexity of your business model, the completeness of your documentation, and the responsiveness to MAS’s queries.
• Potential Delays: Common delays stem from insufficient documentation, lack of clarity in the business model, or extended background checks on key personnel. Working with specialized consultants or law firms can speed up this process.